ARHT Media Inc V.ART.H

From Scotia....goodluck

[newbie880]

.Recent Update Text as of 2SEP09 Niko has acquired an additional 10% interest in its Qara Dagh Block in the

Kurdistan Region of Iraq, taking its overall operated interest to 37%. While no

payment details were provided, we estimate consideration of US$20M-US$25M will

be paid to the KRG from Niko’s cash within the next 60 days. Vast Exploration

(VST-V) also acquired an additional 10% interest (37% overall) in the block,

.under which the KRG will receive 60M shares of the company. With seismic complete, selection of drilling locations is underway and could

see the first well spud in early 2010. Based on our NAV analysis, a 400 mmbbl

gross (148 mmbbl net) discovery could add circa $15.96 per share in unrisked

.NAV accretion. We maintain 2-SP on Niko Resources and have raised our one-year target to

.$86.00 (vs. $85.00), based on our revised risked NAV of $85.51 (vs. $84.81). In our minds, the increased Kurdish exposure is positive, given the discovery

size and potential we see in the region. That said, successful exploration in

Kurdistan could prove to be a material catalyst for Niko; a key source of NAV

accretion and reserve growth. Gavin Wylie